Prossers Risk Jail Time for Not Paying Contempt Sanctions

Bankrupt former Vitelco owner Jeffrey Prosser and wife Dawn Prosser have made no payment on nearly $1 million in contempt sanctions imposed earlier this year, prompting the U.S. Bankruptcy Court to order the couple to pay on schedule or lose their last house and risk jail time.

The court found Prosser in civil contempt of court in 2012 for the dissipation of a valuable wine collection and has issued two orders imposing sanctions that currently total nearly $1 million.

Half of that sum ($419,000) is for the value of wine the court has ruled is missing or destroyed due to the Prossers’ willful neglect. That sanction was imposed in September 2012, but the final tally was not determined until after the remains of the wine were sold in April. The court entered an order May 24, directing the Prossers to pay that portion "within 30 days."

The other half ($528,000) is for costs incurred for a court-appointed trustee to try to force the Prossers to turn over property, plus punitive sanctions against the Prossers for contempt of court.

A Jan. 18 court order directed the Prossers to pay this sum within 30 days – a deadline which is long past.

While most of the Prosser properties have been sold to pay his debts, the court also issued orders in February allowing the Prossers to claim an unlimited exemption for roughly $400,000 in equity the couple holds in Estate Shoys, Plots 168-171.

The court ruled that the couple owned the property as tenants by the entirety, meaning as a couple and not individuals, because it was purchased after they were married. For that reason, only joint debts – held by both Prossers and secured by joint property – could be attached against the couple’s joint equity in the property. As a result of the court’s ruling, the couple may retain that property.

But the court’s May 31 ruling puts that property up as collateral to ensure the Prossers pay the past-due contempt sanctions, and threatens jail time if they do not cooperate with the court.

The order, signed by U.S. Bankruptcy Judge Judith Fitzgerald, directs the Prossers to pay the $528,000 in 60 monthly installments of $8,800. If any payments are late, the Prossers have five days to make payment, and if not, they have 10 days to execute deeds of title on the Shoys property, conveying ownership to the court-appointed trustee.

"Failure by the Prossers to comply with these terms shall be punishable as a civil contempt of this Court and shall subject the Prossers to arrest and incarceration until such civil contempt is purged," Fitzgerald wrote in the compliance order.

The other set of sanctions reflecting the value of Prosser’s former wine collection is due by June 24.

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